Options trading offers flexibility, leverage, and income potential—but it’s not without risks. One of the most important questions beginners ask is: “Can I lose more than I put in?”

The short answer: yes, in some cases—but that’s avoidable with the right strategy.

When you buy options (calls or puts), your risk is limited to the premium you pay. That’s the most you can lose. But when you sell options without owning the stock or without another option to hedge it, you’re exposed to unlimited or undefined risk. This is known as selling naked options.

For example, selling a naked call option means you're obligated to sell the stock at the strike price, even if the stock skyrockets. If you don’t own the shares, you’d have to buy them at the higher market price and sell them at a lower price—resulting in potentially massive losses.

The same goes for naked puts. If the stock crashes and you're obligated to buy it at a much higher strike price, your losses can be significant—especially if you haven’t allocated capital to cover it.

That’s why professional traders use defined-risk strategies—approaches like:

• Credit spreads
• Iron condors
• Covered calls
• Cash-secured puts

These strategies ensure your losses and gains are both capped, giving you a structured way to trade options while protecting your downside.

The key is to never trade blind. Always know your worst-case scenario—before entering a position.

Want to learn exactly how to trade options with controlled risk without complex strategies or unlimited exposure?

That’s exactly what the SlingShot Trader program was built for.

Inside SlingShot Trader, you’ll follow a simple, repeatable system designed to:

• Identify reliable entry points
• Set clear, risk-managed trades
• Avoid the most common (and costly) beginner mistakes

It’s for new traders who want to trade with confidence—without guessing or gambling.

Get started with Slingshot Trader →

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